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Tuesday, 4 September, 2001, 11:07 GMT 12:07 UK
Profile: HP's Carly Fiorina
Carly Fiorina
Ms Fiorina rose from receptionist to corporate giant
A corporate chief's reputation is rarely secure - especially when the chief is a woman.

Just two years ago, Carly Fiorina, newly installed as boss of Hewlett-Packard (HP), was the toast of Wall Street and the media.

Among a string of at times gushing accolades, the Sunday Times called her "the most successful American woman of the decade".

This year, after presiding over the nastiest slump in the brief history of the IT business, Ms Fiorina has been portrayed as at best dangerously unlucky, at worst incompetent.

A Business Week cover story in February concluded that she was "gambling with Silicon Valley's proudest legacy" - and that was before she unveiled an 89% profits slump and a swathe of job losses.

Now that she is close to pulling off one of the industry's biggest ever coups - the $25bn takeover of PC giant Compaq - might Ms Fiorina be due for a bounce?

Rapid rise

Ms Fiorina has arguably been the most heavily profiled and lavishly feted corporate boss in recent US history.

It's not hard to see why.

If not exactly rags-to-riches, her story has genuine Hollywood appeal.

After dropping out of law school, she taught English in Italy, worked as a receptionist and held a series of dead-end jobs.

But her skills as a saleswoman helped her climb the corporate ladder at telecoms giant AT&T, eventually becoming the chief executive of Lucent, the technology firm that AT&T spun off in 1996.

HP sauce

From Lucent, a company at the peak of fashion in the tech boom of the late 1990s, the hop across to HP made great sense.

David Packard and Bill Hewlett posing in front of the famous garage
Mr Packard and Mr Hewlett, and their garage

HP - famously founded in a California garage - used to exemplify the spirit of adventure and invention that underpinned the wealth of Silicon Valley.

But by the late 1990s, HP was seen as worthy but dull, a workaday manufacturer of anonymous and expensive hardware - mainly at the less lucrative end of the product spectrum.

Ms Fiorina's job was to turn her sales skills to making the firm edgier, meaner and - of course - more profitable.

Her main achievement at the firm has been to refocus it from manufacturing individual products towards marketing integrated services, especially e-business solutions, and innovations such as pay-per-use computing.

At the same time, she has consolidated her power, now holding down the jobs of chief executive, president and chairwoman - the only woman to control all three top jobs at a major tech firm.

The empire crumbles

But HP, with its focus on hardware, has suffered especially sharply from the economic slowdown.

Big companies, once lavish spenders on IT equipment, have reined in their budgets, and global computer sales are falling for the first time in history.

Less than two years into her HP job, Ms Fiorina has faced calls for her resignation for the last month, since she revealed that HP's profits fell by 89% in the second quarter.

HP has announced thousands of job losses this year.

And although Ms Fiorina - ever the saleswoman - has been keen to put the most positive possible spin on her company's performance, she was forced to hand back $625,000 of her compensation package for the year, as earnings targets were missed.

The return still leaves her with more than $2m in pay, however, making her one of the best-paid female executives in the world.

The backlash bites

Cynics have long argued that Ms Fiorina would never have been so heavily hyped had she not been female.

But equally, the backlash might not have kicked in so quickly against a male executive.

Her critics had argued that her reforms at HP were more style than substance, rejigging the corporate structure in an attempt to please Wall Street, rather than focusing on concrete improvements in the firm's product line.

HP's fall from grace has also made critics look harder at her record at Lucent, a firm that has slumped dramatically from investor favour since she left.

Make, or break?

Ms Fiorina's test now is to follow through with the Compaq takeover.

The deal has already grabbed headlines - almost all positive, focusing on the cosy fit of the two companies' activities.

But as with all mergers, the key will be whether that logic can be exploited by cost-savings and service enhancements at the $87bn merged company.

In the past, turning a flashy mega-deal into a lasting success has proved frustratingly tricky - just ask DaimlerChrysler or AOL Time Warner.

Grabbing headlines is the easy part, as Ms Fiorina knows better than most.

See also:

04 Sep 01 | Business
HP and Compaq agree $25bn merger
16 Aug 01 | Business
Profits slump at tech giants
20 Jul 01 | Business
Global PC sales slump
25 Jul 01 | Business
Sharp fall for Compaq profits
10 Jul 01 | Business
Compaq cuts jobs and sales forecast
18 Apr 01 | Business
Hewlett Packard cuts 3,000
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